A Canadian-built Toyota SUV is displayed at the Canadian International AutoShow in Toronto on Feb. 12.Sammy Kogan/The Globe and Mail
President Donald Trump’s tariffs cost automakers in the United States US$12.5-billion on Canadian and Mexican cars and auto parts in 2025, according to Michigan-based consultancy Anderson Economic Group.
The amount, tallied using U.S. Census Bureau data, includes US$3.5-billion on parts and US$9-billion on finished vehicles. It does not include the amounts levied on cars imported from South Korea, Japan and Europe, said Anh Do, a senior analyst at Anderson Economic Group.
It also does not include tariffs on the steel and aluminum used to make car components.
“The total tariff burden borne by the American auto industry and its customers last year is much higher when you include tariffs on steel and aluminum, as well as imports from Europe and Asia,” Mr. Do said.
Auto tariffs on cars assembled in Canada or Mexico exceed US$1,600 a vehicle, the consultancy said in a report issued on Thursday.
Patrick Anderson, chief executive officer of Anderson Economic Group, said much of this cost has been absorbed by the manufacturers, suppliers and company shareholders, with a smaller amount borne by car buyers.
The tariff burden can be difficult to measure, because it is dispersed throughout the supply chain and based on metal content, country of origin and date of manufacture, Mr. Anderson said.
Mr. Trump imposed 25-per-cent tariffs on the non-U.S. content of cars made in Canada and Mexico beginning in April, 2025. Auto parts are mostly exempt, but face tariffs based on their non-North American content.
The levies, imposed by Mr. Trump under a trade-law provision intended to defend U.S. national security, run counter to the U.S.-Mexico-Canada Agreement, which has for decades allowed free trade in cars and other goods among the countries.
Mexico brings major trade mission to Canada as USMCA review approaches
After April, 2025, the number of cars entering the U.S. from Canada and Mexico tariff-free dropped to 20 per cent from 90 per cent. That number rose to about 40 per cent by the end of the year as some duties were relaxed, Mr. Anderson said.
Canadian negotiators – and U.S. carmakers themselves – are pushing to have the Trump tariffs dropped this summer, when the agreement is up for a mandatory review.
Prime Minister Mark Carney on Wednesday called the tariffs “unjustified.”
The tariff bill and a massive writedown on electric vehicles helped send Detroit-based Ford Motor Co. to a US$8.2-billion loss in 2025.
General Motors Co.’s 2025 profit fell by 55 per cent to US$2.7-billion, driven by EV charges and tariffs.
Asked why U.S. automakers have not been vocal in their opposition to the tariffs, Mr. Anderson said, “Initially the automakers were up in arms, but at this point they have chosen to be muted in their response.” This is to avoid rankling the U.S. administration while trying to negotiate better tariff terms and, in some cases, refunds, he said.
“There are lots of gray areas in the application of any tariff,” he said. “And for the auto industry, which relies on just-in-time inventory, holdups at the border are very expensive, so they have every incentive to keep trade moving smoothly back and forth across the border, which has largely been the situation for the U.S. and Canada for most of the last 50 years.”